Wednesday's gains followed a dramatic day of trading on Tuesday, when the three main indexes reversed course suddenly to close sharply lower amid lingering worries about slowing growth in China.

"I think today's early rally is because nothing particularly bad happened overnight and while everyone is looking at China very nervously, today's data showed that the U.S. is growing," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

› NYSE invokes Rule 48 for market open in anticipation of volatility
The stronger durable goods data appeared to improve the case for a U.S. interest rate increase in September.

However, New York Fed President William Dudley said an interest rate hike next month seems less appropriate given the recent global market turmoil.

At 11:17 a.m. ET, the Dow Jones industrial average .DJI was up 261.56 points, or 1.67 percent, at 15,928, the S&P 500 .SPX was up 30.83 points, or 1.65 percent, at 1,898.44 and the Nasdaq Composite .IXIC was up 75.83 points, or 1.68 percent, at 4,582.32.

All 30 stocks in the Dow were up.

Up to Tuesday's close, the Dow had lost 10.71 percent in the past six trading days, while the S&P 500 .SPX dropped 11.71 percent and the Nasdaq composite .IXIC 11.5 percent.

The S&P 500 rose as much as 2.9 percent on Tuesday before closing down 1.35 percent, while the Dow rose as much as 2.8 percent before closing down 1.29 percent. The Nasdaq rose as much as 3.6 percent before ending down 0.44 percent.

The Shanghai Composite Index .SSEC ended down for the fifth straight day, underscoring fragile confidence and deep doubt over whether the Chinese central bank's cuts in interest rates and reserve ratios on Tuesday could stabilize the economy.

The dollar index .DXY, which touched a 7-month low earlier in the week, was up 0.13 percent after the U.S. data. Treasury prices fell.

Google (GOOGL.O) shares were up 4.5 percent at $640 after Goldman Sachs raised its rating to "buy" from "neutral" and added it to its conviction buy list.

Cameron International (CAM.N) soared 41.2 percent to $59.94 after Schlumberger (SLB.N), the world's No.1 oilfield services company, said it would buy the oilfield equipment maker in a $14.8 billion deal. Schlumberger fell 4.8 percent to $69.08.